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A deep dive into trends among UK SMEs

by uma

By: Fernando Angulo, senior market research manager, Semrush

 

There are 6 million private companies in the UK, and 5.4 million of those are classified as SMEs. According to the Federation of Small Businesses, they account for three-fifths of UK employment and half of the UK’s turnover. In terms of economic impact, they truly represent the UK’s business backbone. And their numbers are growing – increasing by 72% over the last 20 years, according to Gov.UK statistics. When budding entrepreneurs are looking to set up their own businesses, they turn to Google – and what they are looking for there sheds light on the current state of the SME market.

Semrush has recently conducted a study into small business growth trends, which has shed light onto both popular sectors in startups and the current priorities of the UK’s SMEs. For example, over the last four years of Covid and Brexit turmoil, the most popular types of new startups in the UK, when ranked by their average monthly search volumes, are cleaning, clothing, ecommerce, dog walking and jewelry. Many of the top types of popular UK startups are typical “kitchen table” businesses, stemming from interests or hobbies – these include photography, candlemaking, food, and bakery. This is also reinforced by the numbers of people looking to set up their startup from their home. Searches for ‘small business ideas from home’ have grown by 310%.

 

After such economic and business uncertainty over the last few years, small business owners naturally also have a lot of questions, which they also take to Google as their first port of call. 

For example, searches for ‘how to start a small business’ are up 23% between 2018 and now, while ‘open a small business’ has increased by 75% over the same period and ‘how to open a small business’ is up by 125%. Interestingly, not all of the appetite is for small businesses to be set up from scratch either. Searches for ‘small business for sale near me’ grew by 247% over the last four years.

Overall, it is interesting to note that periods of economic instability stimulate small business development. For example, searches in the UK for ‘how to open a small business’ spiked in the aftermath of Brexit, as well as during the first Covid lockdown in 2020, increasing by 22% in the month the UK withdrew from the EU, and by 83% following the initial Covid lockdowns (comparing data from Feb 2020 to peak searches in May, June and July 2020).

People also turn to their search engines for creative inspiration for their new enterprises. The number of searches for ‘small business name ideas’ has leapt by a massive 5800% over the last four years, while prospective entrepreneurs are also turning to online sources for help and support for more specific small company operational aid. Searches for ‘local SEO for small business’ for example, have grown by 2500% between 2018 and today. Enquiries around ‘small business marketing plan’ have leapt up by 700% while the numbers of business owners looking for more education on marketing approaches are also increasing. Both ‘email marketing for small business’ and ‘examples of marketing strategies for small business’ have grown by 400% in volume between 2018 and today. 

The small business sector in the UK is a vibrant and important one, as well as an option many around the country clearly consider as well within their reach. One striking feature emerging from this report is that competition in the sector is fierce, especially as more and more people consider opening their own business. The number of people turning initially to the online space for help, tips and advice on operational issues from financing through to marketing questions is also something for budding entrepreneurs to be aware of. Small business owners often have to quickly master a number of skills from invoicing through to online marketing tactics. As the economic volatility continues in the UK, many may be looking at the option of going into business for themselves. They may well find that the information – and the keys to helping their businesses to be set up and succeed – may both be found online.

 

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